Political Road Map: Schools are trying to regain control over the size of their savings

Political Road Map: Schools are trying to regain control over the size of their savings
Maddy Zenor calls on a classmate as Missy Morris teaches a lesson in her classroom at Ivanhoe Elementary School in 2016. California school districts are pushing for passage of a bill to erase a 2014 cap placed on their cash reserves. (Katie Falkenberg / Los Angeles Times)

It's been almost three years since Gov. Jerry Brown pushed a controversial plan through the Legislature that, under the right conditions, would force some school districts to spend when they would rather save — and district leaders across California howled in protest.

They hope this is the summer when they finally get back some of that control.


The saga began just days before the state budget deadline in 2014. Brown's administration added a provision to the final spending plan to place a new cap on the size of local school reserve funds — a policy never vetted in public hearings. But the idea had the support of the politically powerful California Teachers Assn., as it sought to force the hand of districts believed to be hoarding cash.

More dollars would ostensibly be available for class programs and teacher salaries. And, it should be said, the teachers were a valuable ally in Brown's quest that fall to convince voters to strengthen the state budget's reserve fund, Proposition 2.

Ever since that time, though, the criticism over what was perceived as a purely political deal has grown louder. And even some of the governor's fellow Democrats say it needs to be reversed.

"The longer the current cap is in place, the more it threatens the ability of California schools to maintain their physical solvency and provide their students the best possible education," state Sen. Jerry Hill (D-San Mateo) said at a legislative hearing last month.

Hill tried unsuccessfully to erase the school district reserve cap in the legislative session that ended last year, but found himself up against strong opposition from the teachers' union.

This year, in an attempt to lower the political temperature of the discussion, he introduced a more modest bill to simply loosen the cap for most districts while removing it completely for the smallest communities and for those whose school funding relies almost solely on local property taxes. The bill could come up for a vote on the Senate floor this week.

The teachers' union remains opposed, citing the fiscal decisions made after the most recent recession.

"What we found is many districts not only increased their reserves but also, at the same time, cut teachers and increased class sizes," Michael Egan, the CTA's assistant executive director, said at last month's hearing.

But the union has stayed silent on a bill by a former teacher, Assemblyman Patrick O'Donnell (D-Long Beach), offering an even more modest loosening of the cap. If both bills keep moving forward, look for some kind of effort to negotiate a compromise this summer. Then the question will become if Brown would approve.

What's fascinating about the imposing of a statewide system for how school districts manage their reserve funds is how it runs afoul of one of the governor's favorite political credos — one he has invoked numerous times since returning to the state Capitol in 2011.

It's what is known as the principle of "subsidiarity," a teaching in the Catholic church that decisions should be made at the lowest governing level when possible. Brown, who in his younger years briefly trained to become a Jesuit priest, relied on the idea when it comes to schools. In 2013, he won an effort to give many local schools new control over how they spend taxpayer dollars.

But if inconsistency is a problem for some, it's not for Brown. During his news conference to unveil his 2015 budget, I asked the governor how he squared the state-mandated school reserve law with subsidiarity.

"That particular provision appears to be an exception," he said. "We did what we had to do."


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